Inquiry into the powers and operations of the Inland Revenue Department

The inquiry's terms of reference were to:

A.    To review the powers of the Commissioner of Inland Revenue to assess and collect income tax pursuant to the Tax Administration Act 1994 and other relevant Acts and to assess whether these powers are justified.

B.    To review the Inland Revenue Department’s application of the compliance and penalties regime established under the tax Acts, including the process by which and the rate at which use of money interest is set, and also the simultaneous application of compounding late penalty payments.

C.    To review the debt management practices and the adequacy of the powers of the Inland Revenue Department to remit tax liabilities or enter into arrangements for deferring the payment of tax and the department’s operation of its powers.

D.    To examine the feasibility and desirability of establishing a tax ombudsman to investigate taxpayer complaints.

E.    To review whether the structure, operation and culture of the Inland Revenue Department, and its understanding of the law, have affected the department’s application of the compliance and penalties regimes and the service it provides to taxpayers and their agents.